Presentation Transcript

Blue =Europe Yellow =Asia Black =Africa Green =Australia Red =America The Olympics The colours of the interlinked Olympic rings were chosen by the International Olympic Committee (IOC) , to represent the union of the 5 continents , Australia , Africa , America , Asia and Europe and further signify the meeting of the worlds athletes at the Olympic Games. The five colours of the rings may be found on most flags of the world The plain white background of the Olympic flag is symbolic of peace throughout the games .

Commercialisation and the Olympics From it’s humble beginnings the Olympic Games has now become a major business enterprise as well as a world renowned sporting competition.

Introduction DRIVING FORCE OF THE OLYMPIC MOVEMENTThe Olympic marketing programme has become the driving force behind the promotion, the financial security and stability of the Olympic Movement. The challenge of financing the Olympic Games has been a recurring theme throughout Olympic history. Since its founding in 1894, the Olympic Movement has depended on partnership with the business community to stage the Olympic Games and to support the Olympic athletes. Today, marketing partners are an intrinsic part of the Olympic Family. For more information go to: http://www.ana.gr/hermes/1999/mar/sports.htm

CONTENTS • Original founding “Amateur “ philosophy • Problems over Funding of Games– Culminating in debts of Montreal • Peter Uberroth and the 1984 Los Angeles Games • The globalisation of sport and the associated role of the Multi National corporations • The “sale” of the 5 Rings • The influence of sponsors and media over event scheduling • Problems over corruption and the hosting of the games

Original founding “Amateur “ philosophy “Amateur” is a Latin word meaning “to love”, so the phrase “For the love of sport” is often associated with the principles of amateurism. • 1896 = Beginning of the Modern Olympics • Amateur status was determined by social class and whether or not competitors earned money from competing. Those not high enough up the social ladder to be able play sport without being paid were excluded. Time and money is needed in order to train and compete at the highest level, so athletes found financial assistance appealing. US introduced the scholarship system in universities, which overcame such pressures, and Soviet Union and Russia, former communist bloc countries, provided state funding of sport. Marketing people were excluded from 1980 Moscow Games due to it being funded by the state, but by the 1994 Games in Los Angeles marketing had become a huge issue in hosting the Olympic Games.

Problems over Funding of Games– Culminating in debts of Montreal The 1976 Olympics in Montreal are remembered more as a financial disaster than a sporting success. Locally, the stunning performances of Romanian gymnast Nadia Comaneci, swimmers John Naber of the United States and Kornelia Ender of East Germany and American boxer (Sugar) Ray Leonard are recalled far less frequently than the billion-dollar debt Quebecers are still paying off. The dream of mayor, Jean Drapeau, to make Montreal a world-class city ended up serving as a international case study on the nightmare the Olympics can become when ego and greed overrule discipline and sound management. Money from the Montreal Games went to pay for venues that in some cases are no longer used for sports. The cycling velodrome was converted into an insect museum because it was too costly to maintain and the pool is often covered over and used as a floor for trade shows. The Olympic Stadium had construction cranes in place of its unfinished 170-metre tower during the Games. The stadium took decades and more than $1 billion to complete. The stadium and the permanent athletes' village across the street ran up huge debts due to a complex design, a labour strike and some on-site corruption, including double-charging for goods by some suppliers. One city official was found to have had a house built free in the suburbs by stadium contractors!.. For more information go to: http://www.canoe.ca/Slam010704/to2008-cp.html

Peter Uberroth and the 1984 Los Angeles Games The IOC appointed to Peter Uberroth, a marketing expert, to make sure the LA Games were a viable proposition, and did not cost the city anything to host. He estimated he could run the games for $500 million and make a profit of between $20 million and $50 million. He charged $225 million for television rights and over double that amount for radio rights. He organised private enterprise to build new facilities and charged for whatever else he could. This demonstrated that if big businesses were associated with such a globally popular event as the Olympis, Baron de Coubertin’s dream could continue to be carried into the future:- "The most important thing in the Olympic Games is not to win but to take part, just as the most important thing in life is not the triumph but the struggle. The essential thing is not to have conquered but to have fought well."

Open Competition? By introducing the IOC to the world of big business, Uberroth possibly affected their decision to develop a system for paying athletes. The IOC did not like the idea of amateur and professional athletes competing together in Open Competition. Instead they left the matter in the hands of the governing bodies of sports. Payment through trust funds was approved. Nowadays full professionalism is the norm in many sports. The IOC couldn’t stop athletes accepting money if they’d already accepted it from other sources themselves could they?! Los Angeles was rewarded with US$26 million worth of new sporting facilities as a result of hosting the games. These then became available for use by a variety of local institutions after the event. This was in contrast to the facilities in Montreal, which were either never completed or had been built at huge cost to the city’s administration.

The globalisation of sport and the associated role of the Multi National corporations The Seoul Olympics in 1988 tried to follow Uberroth’s method, but were not quite so successful.They sold TV rights to NBC and to a Japanese company, as well as providing a share of the profits for the Games organisers. However, the budgeting had relied on more profit being made from TV coverage so costs had to be cut in other areas. Sport was now becoming globally financed, and the introduction of greater media interest gave rise to an increase in involvement from advertising agencies. Satellite technology has broadened global audiences to sport. Subscriptions paid by the viewers give revenue to the broadcast companies which allows them to make huge bids for TV coverage of worldwide sporting events. Avery Brundage would not have been a happy man if he saw what was happening to the Olympics these days!…

The “sale” of the 5 Rings Multinational companies are keen to be involved with the Olympics, and are willing to do anything, including bribery of officials, in order to ‘get a piece of the action’. But they also want to make sure they maximise their returns, so they are keen to get the most out of the IOC in return. As an event that commands the focus of the media and the attention of the entire world for two weeks every other year, the Olympic Games are the most effective international corporate marketing platform in the world, reaching billions of people in over 200 countries and territories throughout the world. Sponsor support is crucial to the staging of the Games and the operations of every organisation within the Olympic Movement. Partner support is not only relevant during the Games period; they provide vital technical services and product support to the International Olympic Committee (IOC), Organising Committees (OCOGs) and National Olympic Committees (NOCs), benefiting athletes, coaches and spectators.

TOPS TOP stands for The Olympic Partner Programme. Created in 1985, the TOP programme, managed by the IOC, is the only sponsorship with the exclusive worldwide marketing rights to both Winter and Summer Games. TOP V PARTNERSThe following companies are TOP V Partners for the Salt Lake City-Athens quadrennium (2000-2004). For more information go to:http://www.olympic.org/uk/organisation/facts/programme/index_uk.asp

The influence of sponsors and media over event scheduling It has not reached the stage of being an exclusive event, with only one sponsor, but the Olympic Games does have a range of official stockists and suppliers. The Atlanta Games generated 34 sponsors and licenced 97 companies to sell their products carrying the Olympic logo. The companies pay a licenece fee to the IOC and sell their goods for profit, whereas the major sponsors, particularly the American TV networks want something in return for their millions of dollars investment… TV rights fees continue to account for approximately 50 percent of Olympic revenue. An estimated 3.7 billion people watched in 220 countries and territories: making the Sydney 2000 Olympic Games the most televised Olympic Games in history, and the most watched sporting event in the world.

Problems over corruption and the hosting of the games Unfortunately some athletes do not believe Baron de Coubertin’s idea of taking part being more important than winning. It is not now against Olympic regulations for athletes to accept payment, but they still manage to find other ways to cheat, which we will look at later. It has also been the case in the past that some IOC officials and commissioners have accepted rewards, including cash, in return for their vote at the appropriate time. Like we said, the Olympics is a good financial proposition for any country to host these days, so they are all keen to be the ones to be chosen. So, in such a case who is the person to blame: the corrupted or the corrupter?!… When one official was asked what would sway his vote for where to hold the Winter Olympics in 2002 he is reported to have replied: “Choices can be based on friendship or where your wife wants to go shopping; this time the choice was the boutiques of Salt Lake City” For years, IOC members have visited potential Olympic sites and received lavish gifts and favors in return. In 1998, this barely disguised, wink-nod secret became public news when reports alleged that the Salt Lake City bid committee was paying university tuition for the daughter of an IOC member.

Samaranch Go here for more info: http://espn.go.com/oly/columns/garber_greg/1225329.html After 21 years as president of the International Olympic Committee, Juan Antonio Samaranch recently retired from office. He was a controversial figure… Samaranch, desperately wanted Eastern bloc countries to participate in the 1988 Seoul Olympics, ignored clear evidence of institutionalised doping in some Eastern-bloc countries and awarded the IOC's highest honors to Erik Honecker of East Germany and his sports minister, Manfred Ewald. Up to 10,000 athletes, many of them minors, were subjected without their knowledge to illegal drugs with dangerous side-effects. For many, the awards seemed to endorse a reckless disregard for human life, not to mention a level playing field. But was it ignorance on the part of Samaranch, or merely cynicism? There have also been charges over the years that the IOC has suppressed positive drug tests at the Olympics because great performances, even illegally induced, make great theater and, therefore, command larger rights fees. This trend changed in Sydney last year when pressure from members forced the IOC to adapt an independent testing system. The trial of Tom Welch and Dave Johnson, leaders of the Salt Lake City bid effort, was scheduled in July 2002. Charged with bribing IOC members with more than $1 million in cash and other gifts, they face 15 felony counts for conspiracy, fraud and racketeering.

Evolution of Olympic Marketing during the 20th Century 1896 ATHENSThe Organising Committee faced severe financial difficulties and sought support from a well-known benefactor, Mr George Averoff, who financed the major expense of refurbishing the Olympic stadium. Companies provided revenue through advertising in the souvenir programme. One of the advertisers in that programme was Kodak, which continues its support as a TOP Partner today. 1928 AMSTERDAMRights were expanded to concessionaries such as a brewery, which was allowed to operate restaurants within the stadium grounds. The Coca-Cola Company, a current TOP Partner, began its long-standing association with the Olympic Games. Advertising was allowed in the programmes, but the IOC made a stipulation that the stadium grounds and buildings could not be disfigured with posters. 1936 BERLINThe first Games to be televised were those in Berlin. This was done on an experimental basis in and around Berlin only, with a total of 138 viewing hours and 162,000 viewers. Only one of the three total cameras could be used live and even then only if the sunlight was bright enough. Berlin was also the first Olympic Games to produce an Olympic Torch Relay.

Television Rights 1948 LONDONHistory has it that the Organising Committee eventually persuaded the BBC to pay the then colossal sum of one thousand guineas (around US$3,000) for the broadcasting rights. Reports at the time indicated that the "BBC later pleaded desperate poverty, but, as they were all gentlemen, when the BBC paid up the organisers never cashed the cheque." However, they had established the principle of the "rights fee." Estimates suggest that over 500,000 people watched the 64 hours of programming. Although the majority of viewers were within a 50-mile radius of London, viewers in the Channel Islands reported excellent transmission. 1958The issue of television rights was incorporated into the Olympic Charter with the introduction of Rule 49 "the rights shall be sold by the organising committee, with the approval of the IOC, and the revenues distributed in accordance with its instructions.“ 1960 ROMEThese Olympic Games were televised live for the first time to 18 European countries, and only hours later in the United States, Canada and Japan, forever changing how the public watch the Olympic Games. An extensive sponsor/supplier programme included 46 companies that provided key technical support and some less key support, such as perfume, chocolate, toothpaste, soap and maps of Olympic sites in Rome.

Television Rights contd. 1964 TOKYOThe number of corporate marketing relationships associated with the Games grew to include 250 companies. A new cigarette brand called "Olympia" generated over US$1 million in revenue for the OCOG. (The tobacco category was later banned.) Broadcasts were global, with satellite coverage used for the first time to relay pictures overseas. Technical support from sponsor companies began to take on a greater role in the staging of the Olympic Games. Seiko created quartz-timing technology, which provided the most accurate timing system to date. 1968 MEXICO CITYThe Olympic Games were first telecast live in colour. Slow-motion footage was also available live.

Olympic Mascots 1972 MUNICHA private advertising agency acted as the licensing agent for the first time. Rights to use the official emblem were sold, and several types of licensing and advertising agreements were available. There was also the first official mascot, "Waldi", whose image was licensed to private firms for sale.

Financial disaster more remembered than gripping Games 1976 MONTREALA total of 628 sponsors and suppliers participated, with the official sponsor programme further broken down into official sponsors, official supporters and official promoters. This programme generated only US$7 million for the OCOG.

Los Angeles 1984 • The Los Angeles Games marked the beginning of the most successful era of corporate sponsorship. For the first time, the OCOG separated sponsorship into three categories: 34 companies signed on as Official Sponsors, 64 companies purchased "supplier" rights, and 65 companies were licensees. Each category had designated rights and exclusivity. In most cases, the sponsor companies were large, multinational corporations. However, the marketing of the Olympic Games was still limited to the host country and US companies. Television (and radio) rights for these Games were acquired by 156 nations, and it is estimated that more than 2.5 billion people were able to view the action.

TOPS 1988 SEOUL: Summer Games1988 CALGARY: Winter GamesUnder the direction of the IOC, a world-wide marketing programme (The Olympic programme, or TOP) was implemented, with the Seoul Organising Committee, the Calgary Organising Committee and a large number of National Olympic Committees (NOCs) coordinating their efforts. The nine business categories for TOP were limited to certain products and services that were marketable world-wide. For other items, OCOG launched the marketing programmes independently. For the first time, the IOC required the host country OCOG and NOC to operate a joint marketing programme. It was decided that the fewer the number of corporations involved, the more value individual sponsorships would hold.

Atlanta 1996 The Centennial Olympic Games were funded entirely through private sources, with broadcast rights fees, sponsorship and ticket sales comprising the Game's sole sources of revenue. The Atlanta Committee for the Olympic Game's (ACOGs) privately funded Olympic Games managed to break even. To ensure that as large an audience as possible could watch the Centennial Olympic Games, the IOC underwrote the cost of the transmissions to Africa. Out of a potential global television audience of 3.5 billion viewers, an unduplicated audience of more than 3.2 billion people watched the Olympic Games in 1996, with a cumulative audience estimated at 19.6 billion. (This unduplicated audience of 3.2 billion is calculated at nine-tenths of available viewers in developed countries and two-thirds of available viewers in developing countries.) The broadcast reached a record 214 countries worldwide. Ticket sales for Atlanta generated 26 percent of total revenue. With 11 million tickets available for sale, total ticket sales exceeded those of Los Angeles and Barcelona combined.

Sydney 2000 The International Olympic Committee (IOC) and the Sydney Organising Committee for the Olympic Games (SOCOG) generated approximately US$3 billion during the period 1997-2000 from the marketing of the Sydney 2000 Olympic Games; mostly from the sale of collective broadcasting rights, sponsorships, tickets and licenses. The IOC generated approximately 63 percent of the overall revenue while SOCOG's unprecedented marketing success within the host country of Australia generated nearly 37 percent of the overall revenue. The Sydney 2000 Olympic Games now stand as the most watched sports event ever. More than 3.7 billion people tuned in to watch in 220 countries and territories, generating more than 36.1 billion television viewing hours. For the first time, Australians and international visitors shared in the excitement of Olympics Live sites around the city of Sydney. Spectators purchased more than 92% of Olympic Games tickets, far exceeding the previous record of 82.3% that had been set in Atlanta.The official website of Sydney 2000 was the most popular destination on the internet during the Games, experiencing more than 11.3 billion hits. "The Sydney 2000 Olympic Games set a course for the future of the Olympic Movement - it stands now in our collective memory as a tribute to the most successful marketing effort the world has ever seen." Richard Pound, Chairman of the IOC Marketing Commission for Sydney 2000